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On Fridays, we schedule our rounds with Healthcare Brew readers. Want to be featured in an upcoming edition? Click here to introduce yourself.
This week’s Making Rounds spotlights Erica Crane, a pharmacist and co-founder of NextRx Pharmacy in Columbia, Missouri, a city inhabited by 125,000 people. The pharmacy features a self-pay model and doesn’t accept commercial insurance. It serves about 300 patients per month.
Crane spoke about why she decided to leave her job in an established health system to venture into the unknown and open a uniquely operated, independent pharmacy.
This interview has been lightly edited for length and clarity.
What’s the backstory of NextRx?
Neal Head [CEO and co-founder of NextRx] came to me and he was like, “Hey, I went to National Community Pharmacists Association’s national meeting, and I heard a guy talk who opened a cash-only, fee-for-service pharmacy. I think this is what we need to do.”
It’s always been my dream to own my own pharmacy, but right now, it’s not a good time to be an owner of an independent pharmacy. But this sort of business model, this could work, this could actually be sustainable. You can make money, but also more importantly, you can save patients a lot of money. That’s how it came to be. We opened in November 2021, so we’ve been here a little over a year.
How does your business model work?
We mainly deal in generic prescriptions because that’s where we can save people money. We only mark up things a certain amount. We need to keep the copays low to be competitive with insurance, but also we have flexibility.
There’s the cost of a prescription, like when I buy it from a wholesaler. Then you have what’s called AWP, or actual wholesale price. Some medications have a really high AWP, meaning it could be $1,000 AWP but the actual drug only costs $2. When you go to the pharmacy and you use your insurance, if it’s one of those drugs that has a really high AWP but it’s really inexpensive and you have a high deductible plan, your copay for this $2 drug might be $300. Rather than you just paying $7 for the prescription with me because I go off of the actual cost of the drug, not the AWP that insurance is built on.
Do you accept any insurance?
Medicaid. I feel like that population of people should have a choice of where they want to go. But other than that, no—and we don’t take coupon cards.
Are you seeing a good response from your community?
Yes, the people who actually take the time to inquire and learn are so excited. It’s just really hard—that education piece takes so long to explain—because people glaze over when you start talking about PBMs and deductibles and AWP. We didn’t think it would be so difficult for people to really grasp why NextRx exists. Mark Cuban has kind of helped. He’s used his platform to inform more people about not using your insurance and how you can save money, so that’s been helpful.
What does the future of NextRx look like?
Hopefully being able to serve a bigger population of people and giving those savings to everybody.
Is this the future of pharmacy? Do you think you’ll see other pharmacies with your business model pop up in the future?
Oh yeah, 100%. You’re gonna see a ton of these stores. We’ve had so many questions—people want to know how we’re doing it. People just want to keep their doors open. The death of independent pharmacy is a real thing.